4 4 Pioneer ACO Basics Launched by CMS Innovation Center, which was formed as part of Patient Protection and Affordable Care Act Began January 1, 2012; a 3-year agreement that can be extended 2 additional years 5 financial models with varying degrees of shared risk Competitive process with only 32 sites selected Dissemination of best practice with other ACOs expected Pioneer ACOs must pass quality gate to be eligible for shared savings

9 Population Measures Admissions per thousand (ADK) Bed days per thousand (BDK) Population ADK BDK National Average Medicare FFS California Average Medicare FFS # of admissions or bed days per 1000 members of a given population in a year CA Medicare Advantage Monarch Medicare Advantage CAPG s Elite Groups MA <220 <800 Updated to 2010, from CMS &SDI 2012, Compiled by Managed Care Digest Series

16 Performance Year 1 Results Quality Performance Top performer in several Patient/Care Giver Experience metrics Monarch scored highest in Physician communication with the patient and Patient overall satisfaction with their physician Top performer in several Care Coordination/Patient Safety metrics Monarch scored highest in prevention of admissions for ambulatory sensitive conditions Medical Cost Reduction 2 nd highest performer in the Pioneer program in PY1 Monarch reduced medical cost -5.4% in 2012 from its baseline, while national medical cost grew +1.1% for a comparable population This favorable expense trend was driven by primarily by reductions in hospital and SNF utilization and unit costs

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